Dec. 2 (Bloomberg) -- Pioneer Food Group Ltd., a South African manufacturer of cereals and juices, said it has offered 12 rand a share, or 828 million rand ($119 million), for wine and brandy producer KWV Holdings Ltd.
A quarter of the payment will be in shares and the rest in cash if the transaction goes ahead, Paarl-based Pioneer said in a statement today. The offer is an 11 percent premium to KWV’s average share price in the 30 days preceding Oct. 13, when KWV first announced it was in talks, Pioneer said.
Pioneer wants to use its South African distribution network to boost sales of KWV’s top wine brands, Pioneer Managing Director Andre Hanekom said on Nov. 3. The top wines of KWV, whose brands include Imoya VSOP Alambic Brandy, Pearly Bay and Roodeberg wines, could be placed into Pioneer’s Ceres Beverage Co., which already owns Hooch, Pepsi, Mountain Dew and 7-Up.
South Africa’s Competition Tribunal on Nov. 2 approved a settlement agreement with Pioneer, which produces Weet-Bix cereal and Heinz Tomato Ketchup, amounting to 1.05 billion rand for violating antitrust laws in its flour and corn milling unit and its bakeries, eggs and poultry businesses.
Pioneer has gained 23 percent in the past 12 months and added 75 cents, or 1.6 percent, to 48.75 rand in Johannesburg trading.
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